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Thursday, September 30, 2010

These are the tpo 10 industries in percentage of stocks making new highs:

Name

Stocks

NH

Percent

Cigarettes

7

3

42.86

Diversified Utilities

26

11

42.31

Housewares & Accessories

5

2

40

Gas Utilities

28

9

32.14

Oil & Gas Pipelines

32

10

31.25

Air Delivery & Freight Services

10

3

30

Industrial Equipment Wholesale

11

3

27.27

Auto Parts Wholesale

4

1

25

Diversified Computer Systems

8

2

25

Major Integrated Oil & Gas

12

3

25

Music & Video Stores

4

1

25

Specialty Eateries

4

1

25

These are the high volume advancers and decliners from the relative strength list:

Advancers

Decliners

Ticker

Relative Volume

Change

Ticker

Relative Volume

Change

BVF

4.36

0.00%

RAX

9.2

-0.35%

GMCR

3.48

0.42%

ENTR

6.89

-2.04%

FMCN

3.37

1.01%

MSB

2.87

-4.67%

PAY

3.33

6.95%

RADS

2.08

-2.95%

VHC

2.13

2.23%

NFLX

2.08

-4.96%

UAUA

2.11

1.07%

TZOO

2.03

-1.83%

JASO

1.96

4.71%

BIOD

2

-0.38%

COGT

1.96

0.00%

TIBX

1.93

-1.83%

CAL

1.87

1.26%

RDWR

1.8

-1.24%

SOL

1.8

2.71%

TEN

1.79

-4.39%

ADTN

1.54

1.52%

CF

1.75

-3.88%

ALTR

1.73

-1.50%

NG

1.73

-2.24%

OPEN

1.72

-1.12%

APKT

1.67

-5.48%

SINA

1.65

-2.26%

SLW

1.64

-1.26%

NTAP

1.62

-2.01%

WSM

1.61

-2.31%

FFIV

1.56

-0.57%

PLCE

1.56

-0.65%

LULU

1.55

-1.04%

MIPS

1.51

-0.81%

I have been havng problems with my earnings database, and in attempting to fix them I prety well trashed it today. I have some stocks to add to the earnings list, and will likely announce them tomorrow, but will wait for the weekend to update the spreadsheet. Rebuilding the database will probably take a while, but not more than a couple of weeks. I hope to have everything updated and corrcted by the end of the year.

This morning's breakout didn't last long: as soon as we gapped up, the selling started, and didn't stop for another 2 and a half hours. Even after that, we got a timid rally attempt at best. Volume was pretty high today, and I would venture to guess that this will qualify in IBD as a distribution day. It is still looking like a pullback is in the cards, and after today a retest of 1130 looks very likely.

The Nasdaq took it a little harder today, and volume was quite high here. it looks like 2310 is where the support is here, and it looks pretty strong, so I think we will retest it in the not to distant future. The last time I looked at this I remarked about the price relative almost going straight up. Not anymore.

The Russell 2000 already has retested support, and passed. Here the price relative line is stregnthening. If anything, any pullback here should be pretty weak, and if this continues to strengthen, it should lead the market up.

Here are the new highs n the Nasdaq. Whie the uptrend has stalled, it is still well above 100, the iaginary line between bullish and bearish. This, at least, does not indicate any major weakness in the market.

The new highs on the NYSE have also stalled, but, again,m are not indicating any imminent collapse, at least, not yet. Notice that this is not longer stronger than the Nasdaq, which, if recent history serves as a guide, is a bullish indication for the market, at least in the short term.

It sure looks like the SPX and Nasdaq have topped out for the time being, and they may have, but the strength of the Russell 2000 and the strong market internals tell us we may be in for a nominal pullback here,Much is being made of this being the best September since 1939. Unfortunately, that also marked a top, and the bottom wasn't found until 1942. Let's hope we don't have to ind one the same way.

The only notable area of strength toay was solar stocks, which, unfortunately, does not have it's own group on finviz. TSL is probably the strongest of the group, and it broke pout today after a near breakout yesterday. This is an interesting "base within a base" pattern, and it never ceases to amaze me to see symmetry like this. The pivot points are pretty well defined here and are nearly exactly equal distances from each other,

1150 gave way this morning, but it didn't last long. It does pove, though, that 1150 is vulnerable and may not be the ultimate resistance. For now I have an 18 point range with 1150 in the middle, and I doubt we stray too far from that range. The game of musical sectors continues, as yesterday's weakling is leading today, XLF. All other sectors are right about even, just above positive. The Nasdaq is lagging slightly, the Russell 2000 is about even. Oil is up, gold is down, and treasury yields are rising.

I have 289 new highs so far, with breakouts in VRNT, LCRY, OPLK, CFS, STKL, NICK, and GTE. SNX from the earnings list reported last night and is up 8% this morning.

Right on time, at just the right place (slameed up against resistance), the boys hit the sell buton, an down we went. On the Elder impulse chart we now have two clusters of blue bars, which, in the recent past, has indicated a trend change was coming, and it appears to me we are going to head down from here. Best case is down to 1130, next best down to 1120, which is just abpve the 200dema, and probably about where the simple average is. How far down we go is a guess, but the probability is that e are going down, and somebody big agrees, because they sold in force in the last hour.

Technically the Nasdaq is in about the same shape, and the conclusion here is down as well. Again, we don't lknow how far, but holding 2307 would be a very bullish development. The market is awfully stretched here, as we have not had a red bar in oper a month (the best stretch in the last six months), and it's hard to believe that will go much longer.

Well, this throws a wrench into the analysis. The Russell 2000 followed through on yesterday's breakout and is posting green bars. This flashed the first buy signal at the start of this rally (two days earlier than the SPX), but weakened on the way up. Is this leading us up, or is this a last gasp before a down leg?

The energy sector has been the laggatd in this rally, but has recently shown strength, and is now on it's 4th consecutive green bar. It close one cent below the August high, so it is right on resistance now. Notable here is the strength of CMF, which stayed positive even during the August swoon.

Well, this is unpleasant (actually, it couldn't happen to a nicer bunch). The financial sector, which came out like gangbusters on the September follow through day, ran out of steam pretty quick, flashed a sell signal over a week ago, and is now under the 200dema. If this breaks 14.20 I suspect it will drag the market along with it.

Energy strong, financials weak, it sounds almost like 2008, doesn't it? How did that one turn out?

TEN broke out of what looked like a double bottom base back in early August, but the base was not valid and the breakout failed.It then pulled right back to the 50dma, where it found support, getting good volume today on the breakout. The price relative line is at a new high, but just barely.

HOGS poked out to a new high briefly on a breakout attempt, but volume was a little low and late selling didn't help. The price relative line here is quite weak, and CMF has been in a decline. This one looks like it may be weakening.

OCLR broke out of a poorly formed base, but did get decent volume considering there wasn't anything I saw that drove it. One thing it has going for it is a breakout in the price relative line, something we haven't seen much of lately.

We may have stumbled on to a group that is strengthening. Computer based systems is a 7 stock group that has, for the past year, been quite weak, and while I would not say it is strong now, it is trending up and even the 40 week average is now climbing. LXK is the only big stock in this group, and is making big move today. The charts overall aren't that impressive, but some of these appear to be seeing rotation.

All is fairly quieton the market leadership front after yesterday's interesting action, ULTA is the only one hitting a new high, and it is getting slightly above average volume. NFLX i the only one making a significant move.

It looks like today we may be stuck in between 1140 and 1150, as we wait to see if we are just pausing before a blast above 1150, or pulling back to 1130 or beyond. At this point, we have no real choice since, as has become all to obvious in recent days, we are tat the mercy of the computers and the boys who have the inside info. We have another game of musical sectors today, with XLE leading by a mile, XLF and XLY lagging. Both the Nasdaq and Russell 2000 are leading slightly. Oil and gold are up, and an oil inventory report came in this morning lower than expected, which is probably why the energy sector is so far out front. Treasury yields are up a bit.

There are 162 new highs this morning, with breakouts in OCLR, MOSY, FDO, NANO, and CHKP. On the earnings list we have SNX reporting after the close today.

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About Me

I am not a financial professional, just a guy that trades my own account.
I am also not a musical professional, just a guy that makes music on the computer. Thus, two blogs, one trading and on musical.
And, no, the picture is not me, it is the late, great John Belushi, one of the inspirations for these blogs.

About ThIs Blog

This blog is focused on technical analysis of stocks and markets, putting heavy emphasis on chart analysis. My trading style is derived primarily from my mentor, William "Yoda" O'Neil, and the focus here is on leading and breakout stocks, but all forms of trading are covered to some extent. Economic and political news that effects the market are also topics here, and the blog may occasionally become a platform for my political and philosophical ranting. I keep several spreadsheets on Google docs which track various aspects of the market and readers are welcome to vies and comment on them.

Google Docs Spreadsheets

There are several spreadsheet that I maintain on Google docs to track various watchlists and trends in the market.

1. The earnings list - a group of small and micro cap, low float stocks that have exhibited recent rapid earnings growth. They are modeled along the lines of William O'Neil's CAN SLIM system, but limited to small cap, highly volatile stocks.

2. The relative strength list - a group of stocks which are near 52 week highs and have shown an increase in average daily volume. The list is limited to the top 200 stocks according to my methodology, which will be detailed on one of the pages of the spreadsheet.